There’s a whole lot of confusion around the term “Neighboring Rights” stemming from where the name comes from in the first place. People often confuse it with the idea of receiving payments from neighboring countries, but what it really means is a lot easier to explain. Neighboring Rights are basically public performance royalties which sound recording copyright holders are rightfully due. Keep in mind that there are two basic types of copyrights attached to every song: one for the composition of the song, and one for the recording of it. Songwriter’s and publisher’s get paid by the copyright of the composition itself, whereas it’s the sound recording copyright that pays the record label and the artist that recorded the song. “Performance Rights” has to do with the right to publicly broadcast the music composition tied to whatever song is in question, the “Neighboring Right” is the payment the owner of the sound recording is due (generally the recording artist and/or the label) for that same public performance. Both payments for neighboring rights and performance rights alike are collected by large international collection agencies. The law places “Neighboring Rights” for performers “exactly alongside” those of performance rights for songwriters, which is what is behind this odd legal term. Make sure you understand clearly the difference between terrestrial broadcast platforms (like radio, TV, and venues) and digital platforms (like Internet and satellite radio) when it comes to talking about performance royalties for sound recordings.
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